Unisys to Lay Off 2,500, Including 500 in California

Times Staff Writer

Unisys Corp., the giant computer maker that has been trimming costs to offset sagging profits, said Wednesday that it is laying off about 2,100 employees worldwide this week.

The company, the nation's third-largest computer maker, also said that an additional 400 engineering workers at corporate headquarters in Blue Bell, Pa., would lose their jobs at the end of the summer.

In California, which has more Unisys employees than any other state, about 500 workers will lose their jobs, a company spokesman said.

Among those who will be laid off are 350 workers at a disk drive manufacturing plant in Santa Clara, where Unisys' peripherals group is based. The other 150 California employees losing their jobs are scattered in sales and marketing positions throughout the state, a company spokesman said.

In all, the layoffs affect employees at about 60 plants throughout the country and at one 400-employee manufacturing plant in Nogales, Mexico, which will be closed.

The company announced the layoffs after the close of trading on the New York Stock Exchange. Unisys shares closed at $53.125, down $1 for the day.

Unisys officials have said that by year-end they expect to have cut a total of about 2,800 jobs from the company's work force, which stood at about 93,000 in January.

Tuesday, Unisys said it is offering incentives to employees who retire early or voluntarily leave the company. Employees who are at least 58 years old and have 15 years of service will qualify for early retirement. Unisys is also offering "voluntary layoff" benefits to other employees, who will receive one week's pay for each year of service, plus expanded severance pay, she said.

The layoffs and incentives to quit the company are part of a continuing attempt by Unisys to reduce expenses and reorganize itself before beginning a new round of growth. A spokesman said that when the reorganization is complete at year-end, the company will have about 90,000 workers--down from more than 95,000 just two years ago.

However, he stressed that the company's long-term goal is to double its revenue from the current level of about $10 billion a year to $20 billion by the mid-1990s. He said that as the company's revenue begins to grow again, employment levels would increase.

But, until the transition is complete, Unisys expects to turn in a stagnant performance. Earlier this month, the company said it expected its sales to be flat for the first quarter because of a shift to a new product line, the need to work off about $500 million in excess inventory and costs associated with its purchase last year of Convergent Technologies in San Jose.

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